Centuria to merge with Primewest
Centuria Capital Group has entered into a bid implementation deed in relation to a merger with Primewest via an off-market takeover offer made by Centuria for Primewest.
In an announcement made today to the Australian Securities Exchange (ASX), Primewest said the rationale behind the decision was both firms offered complementary funds management platforms with similar investment philosophies and strong track records.
Primewest’s board, whose directors represented 53%of Primewest securities, unanimously recommended to its securityholders to accept the merger, in the absence of a superior proposal and subject to an independent expert’s opinion that the deal is “fair and reasonable”.
Under the terms of the deal, Primewest securityholders would receive $1.51 per Primewest security, consisting of:
- $0.20 of cash per Primewest security, and
- 0.473 Centuria securities per Primewest security, equating to $1.31 per Primewest security based on Centuria’s last closeprice of $2.77 per security on 16 April.
The merger would be expected to enhance investment proposition relative to Primewest thanks to:
- Material earnings per security accretion of 19%,which would deliver 6.8 cents on a pro forma FY21 basis;
- Substantial increase in scale and relevance with combined AUM of $15.5 billion;
- Enhanced geographic and sector diversification;
- Access to new distribution channels, and
- Material synergies to support growth of AUM, expansion of property services across both businesses.
Additionally, the merged group would be expected to be well placed for S&P/ASX 200 index inclusion with an estimated pro-forma capitalisation of $2.2 billion.
Centuria chairman, Garry Charny, said: “The proposed Centuria/Primewest Merger is consistent with Centuria’s dual strategy of asset acquisitions and corporate M&A, where this is sympathetic to Centuria’s business model.
“Primewest is a high quality, well-established fund manager and the Centuria board looks forward to the successful completion of the merger and building on Centuria’s position as a leading Australasian property fund manager.”
AUTHOR
Oksana Patron
Recommended for you
Australian fund managers are actively seeking to launch Cayman versions of their funds to attract offshore flows, with Regal Partners set to launch its latest offering this month.
As private markets gain traction in Australia but only a limited pool of talent is available, three recruiters explore whether fund managers should consider looking overseas to find top talent.
With an explosion of private credit managers appearing in the market, two alternatives experts believe a consolidation is needed to maintain the quality of the sector.
Bentham Asset Management has become the latest fund manager to expand its distribution team as it reports increased interest in its credit strategies.
